The U.S. Court of Appeals for the First Circuit has upheld a lower court ruling that Eversource Energy and Orange-based Avangrid don’t have to face a $3.6 billion class-action lawsuit claiming they manipulated natural gas prices in New England by booking unneeded capacity on natural gas transmission lines in the region.
The ruling from the First Circuit court was handed down Wednesday, according to Law360.com. The court affirmed a ruling by a Massachusetts-based federal district court judge in February that dismissed a class-action lawsuit filed on behalf of utility customers by New Hampshire energy marketer PowerNE.
First Circuit Court Judge William J. Kayatta wrote the unanimous opinion in the case finding that the Federal Energy Regulatory Commission — and not the nation’s courts — is responsible for determining rates
The class-action lawsuit claimed Eversource and Avangrid artificially drove up consumer costs by $3.6 million by reserving more capacity than either utility needed to serve their natural gas customers.
FERC officials cleared the two utilities companies of any wrongdoing in the case in February 2018. The FERC ruling was the culmination of an investigation into allegations made in 2017 by New York City-based Environmental Defense Fund. The group claimed that by manipulating natural gas transmission line capacity, the companies drove up prices that their customers paid for natural gas as well as electricity.
Spokespeople for both utilities said they were pleased that the First Circuit court upheld the district court judge’s ruling.
“The U.S. Court of Appeals for the First Circuit now joins the lower court, as well as the Federal Energy Regulatory Commission and the Connecticut Public Utilities Regulatory Authority, in rejecting these ill-informed and meritless allegations,” said Ed Crowder, an Avangrid spokesman. “We have said along that Avangrid’s local distribution companies, Southern Connecticut Gas and Connecticut Natural Gas, managed their natural gas portfolio in a manner consistent with their legal and regulatory mandate to provide safe, reliable service to customers under all weather and service conditions.”
Caroline Pretyman, a Boston-based spokeswoman for Eversource, said taken collectively, the court and regulatory rulings “found the EDF report flawed and not supportable, which reaffirms what we have stated all along — that the claims made by EDF in the report were patently false and misleading.”
“We always act in the best interest of our customers,” Pretman said.